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Business Valuations: Benchmarking and Trending of Financial Data

I want to talk about benchmarking and trending of financial data in the context of a business valuation.  Reviewing other experts reports, I believe there is some confusion among business valuation experts as to what benchmarking and trend analysis is. Benchmarking Using Risk Management Associates It is my experience that in the business valuation world,…  Continue Reading »

How To Find A Business Valuation Expert

Understanding Business Appraisers Accreditations Business Valuation: What a Business Appraisers Accreditations Mean and What They Can Tell You About the Appraiser. I want to address the by comparing and contrasting the requirements to obtain the various business valuation credentials.  Some of the designations are extremely difficult to achieve while others are not as stringent. “Is…  Continue Reading »

Medical Helicopter Missions in Vietnam
J. Richard Claywell, Viet Nam Medic

Background I want to tell you something personal about me that very few people know. I was a medic in Vietnam from November 1969 through August 1971. I was assigned to a battalion aid station at Tam Ky and was extremely fortunate as the physicians took several medics under their wings and taught us how…  Continue Reading »

Business Valuation: Reliance on Third Party Appraisers

I want to address the reliance on third party appraisals and the requirement for their use. I first want to address the Professional Standards that apply to all Certified Public Accountants Certified Valuators and Analysts. Within the business valuation standards of both of these professional business valuation organizations is paragraph 20 that discusses “Using the…  Continue Reading »

Business Valuations: Excess Earnings Method

I want to address the use of the Excess Earnings method when performing a business valuation.  This methods originated in Revenue Ruling 68-609.  A number of treatises have developed and should be followed by business valuation experts. Application of the Excess Earnings Methodology The excess earnings methodology for performing a business valuation is based on…  Continue Reading »

Business Valuations: Using Rules of Thumb

I want to address the use of Rules of Thumb when performing a business valuation. First, business valuations follow Revenue Ruling 59-60 (you should look this upon the internet), Professional Standards and a number of treatises have developed and should be followed by business valuation experts. The Rule of Thumb is a pricing multiple, not…  Continue Reading »

Business Valuations: Introduction to Revenue Ruling 59-60

The thrust of this series is to educate the attorney on what is expected to be performed in doing a business valuation for both non-litigation and litigation cases.  We will discuss the issues addressed in Revenue Ruling 59-60 and the treatises that have evolved from it. Revenue Ruling 59-60, Fair Market Value What is Revenue…  Continue Reading »

Business Valuation: Introduction to Pricing Multiples

Hello, my name is Richard Claywell and this is litigation speaks.  When a business valuation is performed, I have seen cases where the opposing expert will use Earnings Before Interest Taxes Depreciation Amortization (“EBITDA”).  I want to talk today about what the pricing multiples mean. Pricing Multiples The most popular method of determining a value…  Continue Reading »

Business Valuation: Not Converting Net Income to Cash Flows

Hello, my name is Richard Claywell and this is litigation speaks.  When reviewing business valuation reports I have seen cases where the opposing expert will capitalize pre-tax earnings and then apply an after-tax cash flow discount/capitalization rate to the earnings. Depending on the experience level of the expert, they may not notice this potential error…  Continue Reading »

Business Valuation and Lost Profits: How Reliable Are The Experts Forecast?

The business valuation, lost profits expert will need to forecast or project the revenues and related expenses to determine the value of a company or the lost profits or damages in a case.   There are multiple techniques for making the forecasts or projections.  One of the techniques used in business valuations and lost profits cases…  Continue Reading »

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